President Obama delivered tonight a powerful State of the Union speech. Conveyed with passion and emotion, it will be remembered for many things -- from the emphasis on greater gender equality to the moving tributes for inspirational citizens and the presence of families whose lives have been torn apart by gun violence. The speech's longer term impact will also depend on whether the economic messages, including the urgency of growing America from the middle out, resonate loudly and durably both inside and outside Washington, DC.
Trained as an economist, I sat down to listen to the speech with expectations and hope. I came away cautiously optimistic that, given proper follow-up, its content could do more than just nudge Congress towards more constructive economic behaviors.
The speech was refreshing, contained new ideas and avoided bitter partisanship. In the process, it encouraged all Americans to ensure that Congress does not keep on hitting the snooze button. Let me explain why using four different personal perspectives.
1. As someone who worries about America's disappointing recovery from the 2008 Global Financial Crisis, I was relieved that the President focused so much of his speech on unlocking this country's enormous economic and financial potential.
In noting the progress made in clearing "away the rubble of crisis," he rightly stressed the importance of "reigniting the true engine of America's economic growth" - and do so by equipping a potentially-thriving middle class with better education (including pre-school), improved infrastructure, labor retraining that is more relevant for today's competitive world, fewer tax distortions, less red tape, enhanced housing finance and college funding, and innovative public-private partnership.
The President also vividly illustrated why politicians should avoid creating additional air pockets for the economy's already bumpy journey away from the crisis. As a civilized and compassionate society, do we really wish to unnecessarily lose jobs and derail education, energy and health priorities?
As the President stressed, an important first step is to avoid another self-inflicted wound by transforming the sequester -- a blunt set of budgetary spending cuts that were never meant to be implemented -- into a more coherent approach to fiscal policy. This can, and should be done while pursuing a longer-term agenda of sustainable deficit reduction through reforms of both the revenue and spending sides of the budgets.
A growing economy does more than offer low- and middle-income citizens a better ability to meet their legitimate aspirations, including providing a better life for their families. It also serves to reconcile competing political claims on limited resources, and reduce the future risk of social discontent.
2. As a citizen who values the inclusive nature of America's development process, I was happy that the President stressed the importance of growing our economy via emphasis on the middle class.
For too many years in the run up to the 2008 crisis, America's growth model succumbed to the dangerous appeal of unfettered trickle-down economics fueled by seemingly limitless leverage and credit entitlement. The result was more than a crippling financial crisis.
America also stopped investing enough in its sustainable engines of growth and job creation. And the first (and most) to suffer were low- and middle-income families that had neither the savings cushions nor the financial agility to absorb cascading dislocations.
3. As a CEO with fiduciary responsibilities, I was delighted that the President did not hesitate to assign responsibility among members of both the executive and legislative branches of government.
Clear delegation and accountability enhance the potential for progress and for further accelerating the country's reform momentum - particularly so when the challenges facing us require a sense of shared responsibility and reinforcing collective actions.
4. Finally, as a realist, I recognize that what happened tonight is a necessary but not sufficient condition for reinvigorating the economy, improving income and wealth inequalities, and reducing poverty.
In setting out the "north star" for the American economy and what is needed to follow it well, President Obama has provided Congress with the air cover to move forward with the needed set of detailed policy initiatives and legislation. Yet more is needed if Congress is to resist slipping back into its curious sequence of paralysis, complacency and decision by brinkmanship.
This is where the rest of us can come in.
President Obama is right: "The greatest nation on Earth cannot keep conducting its business by drifting from one manufactured crisis to the other." Thus the urgent need for tonight's loud wake-up call for Congress.
The social media revolution and the spread of digitalization have empowered citizens in a manner once deemed unimaginable. It is no longer necessary to wait for elections to make politicians realize how serious Americans are about placing the economy back on the path of high growth, low unemployment, and financial stability.
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